Imagine you're launching a company and only have six months to deliver a product. You face a competitor that has been in your industry four years longer than you with twice your staff and twice the budget. If you don't make your deadline, you're out of business.

That, in a nutshell, was the situation facing the technology team for Mitt Romney's presidential campaign. The Obama for America (OFA) organization had the advantage: it didn't have to wade through the primary season first, allowing OFA's technology team to focus on building an infrastructure. Based on an Ars analysis of the Romney campaign's financial reports, Romney's team had less to work with and passed the lion's share of technology-focused spending directly to advertising companies and telemarketers. This left Team Romney's tech squad with only a fraction of the budget for consulting, services, and infrastructure.

So, the campaign did what a lot of small businesses would do: they went to Best Buy. Or more accurately, they went to Best Buy's subsidiary, MindShift Technologies, a managed service provider that specializes in small and medium business consulting. And when they were in a pinch for tech help, they called Staples' subsidiary ThriveNetworks and a collection of small consulting firms with links to Romney and the Republican Party.

Apparently, that didn't work out so well.

Managing IT like a distressed asset

The Obama campaign's Team Tech planned its game assuming they would be the underdog. "We had no idea what the other side was doing," said Obama for America Senior Engineer Clint Ecker. "They had a bunch of money, and our presumption the whole time was these guys are smart business guys. We could only assume they were expending the same amount of resources to building up the same sort of infrastructure that we were."

Instead, the Romney campaign did what many corporations have done in tight times—it kept its IT budget in check and heavily outsourced technology relative to its budget, keeping only a few strategic efforts in-house. At the same time, top executives took care of their own base, bringing in their own companies and those of friends to provide key services. While it wasn't exactly a consulting feeding frenzy, the Romney campaign left most of its technological fate in the hands of outsiders—and even internal projects like Orca were dependent on quick fixes from outside talent.

Romney's total staffing was lean—over all, about 510 people collected paychecks from the Romney campaign (versus the over 1,000 people on OFA's payroll). The campaign's own IT operation was lean as well—only one percent of the campaign's overall expenses of $339 million went to supporting internal information technology. That included consulting and outsourcing services, Web hosting, broadband, hardware, and software. Ten times as much was spent by Team Romney's Digital and Voter Contact departments on external interactive advertising, telemarketing, and data management services—$36.4 million in total.

Romney's campaign followed a typical "go small" mid-sized business strategy for IT—outsourcing day-to-day IT to a managed services provider, bringing in spot consulting to help form strategy, and buying software and services from old friends. Companies with ties to Romney staffers got a lot of Romney's business. And when the campaign needed emergency tech support, they hit the "easy" button. For the meat of its internal tech team, the Romney campaign went cheap and young. In once case, they hired a freshly-minted RIT graduate as a contractor to be a system administrator, paying him just over $12,000 for six months of work.

A little help from (and for) my friends

At the top, however, Romney's campaign brought back old hands and paid them well. Kevin Rewkowski, a tech deputy during Romney's primary run in 2008, returned to serve as the campaign's Technology Director and pushed a lot of tech business through his company, Minuteman Strategies (that's in addition to Rewkowski's six-figure salary). His CFO also double-dipped, with money going to his financial compliance software company.

To round out the skills needed to support the campaign, Romney turned to a collection of small consulting shops—in some cases, one-person companies were formed to allow well-connected people with day jobs, like one former IT project manager of Bain Capital, to do technical consulting off the clock. The campaign also turned to a "virtual CIO" service to get strategic direction and called in some friends-of-friends, including a former Bain data center manager, as short-term advisors. He also paid his political action committee, Free and Strong America PAC, $34,183 for database development. He bought computer hardware from the PAC as well.

Acquired by Best Buy in 2011, the managed services company provided IT outsourcing, desktop support, and network services (including office PCs). CEO Paul Chisholm was a longtime Romney supporter, according to FEC contribution records.

The company of Romney Tech Director Kevin Rewkowski, who also worked tech for Romney's 2008 campaign. Performed Tech consulting and network support, and provided Internet services (including provisioning e-mail servers on Rackspace).

Picking a few things up at the Apple Store

The Romney campaign didn't just rent its computers and network equipment. It also bought some things, including more than $67,000 worth of gear from Romney's Free and Strong America Political Action Committee. Some of the purchases were mislabeled in the report, with $2,652 spent at "210 Andover Street"—which is actually the address of the North Shore Mall in Peabody, Massachusetts. Someone in the Romney campaign even paid for a piece of hardware through PayPal.

Computer and tech equipment purchases

210 ANDOVER ST (possibly the Peabody, Mass. Apple Store)

$2652.05

AMAZON.COM

$26,422.9

APPLE

$33,606.12

B & H PHOTO-VIDEO

$1,248.05

B&H PHOTO-VIDEO

$507.2

BEST BUY

$79.67

BEST LECTERNS

$1,068

CDW

$56,174.13

CDW DIRECT LLC

$54,275.54

CELLHIRE LLC

$5,753

FREE AND STRONG AMERICA PAC. INC.

$67,046.5

FRY'S ELECTRONICS

$613.79

MICRO CENTER

$235.47

PAYPAL

$79

PROVANTAGE CORPORATION

$1,586.25

RITZ CAMERA

$3,1.85

RYTHER CAMERA

$6,999

SEARS.COM

$484.49

SMART CITY NETWORKS

$2,831

SOUND & IMAGES INC

$250.36

Total

$261,944.37

The cloud, Romney style

The Romney campaign was decidedly "cloud" in a 2008 sense of the word, relying on software-as-a-service and outsourced data centers. SaaS was used in nearly every department—SalesForce-based CRM, human resources management, and financial systems were all Web-based services. The biggest software expense—consuming 88 percent of the campaign's software budget—was a specialized campaign finance compliance SaaS system from Red Curve Solutions, a company started by Romney campaign Chief Financial Officer Bradley Crate. And the campaign spent $5,400 on TV Eyes, a Web service for searching and monitoring mentions on radio and television nationwide.

There was also a $160 fee paid to WordPress, and someone bought the campaign a Flickr Pro account.

As a sign of just how outsourced the Romney campaign's Internet presence was, Romney for President spent $21,000 directly on Web hosting. By comparison, the Obama campaign spent $1.4 million. The Internet services portion Minuteman Strategies' services (which accounted for about $16,000 of the payments made to Rewkowski's company by the campaign) amounted to just short of half of what the campaign's entire Internet hosting and services cost. The remainder went mostly to Brightcove, which sold Team Romney $19,922 worth of video cloud capacity.

Outsourcing, insourcing, and the robot uprising

While the Romney campaign was counting on outsourcing to ramp up quickly, the Obama campaign chose instead to heavily insource IT. Overall, the Obama campaign spent $9.3 million on technology, while building a mini-army of its own software and systems engineers who were part of the campaign's 1,000-person payroll. While it did outspend the Romney campaign on IT consulting (OFA tallied $3.5 million in consulting), that number included all of the Obama campaign's expenses on "digital" consulting from companies such as Blue State Digital as well. These efforts were tied into the Obama campaign's central technology infrastructure.

This paid off in a number of ways, including a reduction of the Obama campaign's dependence on telemarketing. The campaign brought most of its data management and analysis in-house, and turned its volunteers into a powerful data collection tool. While the Romney campaign spent $15.5 million on telemarketing services, the Obama campaign spent $11 million on outside telemarketing, relying more heavily on volunteers using the Call Tool developed by the campaign's Technology department.

Whether insourcing versus outsourcing mattered in the final vote count is debatable. The details of the "failure" of Orca (the strategic get-out-the-vote tool of the Romney campaign) still remain as murky as Orca's impact (or lack thereof) on the election. "Reading all this stuff about Orca has been scary," said Obama for America Chief Technology Officer Harper Reed, "because I don't like celebrating tech failures—I would never wish that on any enemy or opponent. It's a scary thing in the world, because technology is not our friend. It only fucks us over. We're just waiting for the robot uprising."

187 Reader Comments

Did the RNC really not have any infrastructure ahead of time and leave the Romney campaign to build the entire thing? That seems... poorly thought out. Sure the Obama team had a four year headstart vs Romney, but it's not like the RNC didn't know *someone* from their party would be running for president.

Did the RNC really not have any infrastructure ahead of time and leave the Romney campaign to build the entire thing? That seems... poorly thought out. Sure the Obama team had a four year headstart vs Romney, but it's not like the RNC didn't know *someone* from their party would be running for president.

It's probably difficult for a campaign to accept that kind of infrastructure and support from their party without running afoul of campaign finance rules. You'll note that Obama's campaign built their own infrastructure, too (their head start was because he had run before, not because the DNC had already started work on the system).

One of my parents is a Republican county chair and... I can confirm their version (up to the state level) of tech-savvy is "which key is the Any key?". As a former IT consultant it makes me cry on the inside. But as a democrat-leaning independent I'm cracking up.

I didn't see NewEgg as a shopping center on that vendor list but obviously you don't care about money if your spending your cash at Apple =/ IF your running a campaign for several months wouldn't have been wiser to go through a 100% refurbished method on most of the possible hardware?

Then again when your going to Staples and Best Buy subsidiaries for tech help you've already dug yourself a grave at some level...

I didn't see NewEgg as a shopping center on that vendor list but obviously you don't care about money if your spending your cash at Apple =/ IF your running a campaign for several months wouldn't have been wiser to go through a 100% refurbished method on most of the possible hardware?

Then again when your going to Staples and Best Buy subsidiaries for tech help you've already dug yourself a grave at some level...

If you are doing a very short buildup/teardown, you don't necessarily want to be dealing with the potential hassles of piecing together a bunch of refurb gear. That said, you also don't necessarily want to be dealing with the costs, and hassles, of configuring a bunch of random hardware pulled from the shelves of your local retail outfits.

You can get leases or rentals for suitably large blocks of standardized gear which may well be a more viable option.

So in the end this was a hastily planned thing, where they chose to rely on nepotism. Doing some friends a favor, instead of doing business. And besides, outsourcing is great, because if you pay someone else, they're responsible, right?It also seems like they had no real expertise in house, which usually means you'll fail because you can't even manage your contractors and consultants on the right level.

Sounds like what I'd expect from a thing run by politicians and perfectly fits my totally superficial impression of Romney. I'm a bit surprised Obama did so much better, though.

Bradley Crate founded Red Curve Solutions in 2008 after serving as the Deputy Chief Financial Officer for the Romney for President campaign. Previously, he worked in the Romney administration as a fiscal policy analyst and Director of Capital Planning and Policy and as the Political Operations Director for his 2002 campaign for Governor.

Other people have a similar background.

Basically, a 'friends of Romney' company. One wonders whether their services were really worth several hundred thousand dollars, or whether this was just a way of funneling campaign donor money to some old friends.

It is striking the extent to which people inside the campaign were apparently interested in looting Romney's funds for their own benefit with the actual campaign seemingly an afterthought.

I guess Romney just surrounded himself with shady people? Or perhaps people on the inside realized that Obama was probably going to win and were looking ahead to after the election. Either way, will be really interesting to see more of the post-mortem on the Romney campaign.

It is striking the extent to which people inside the campaign were apparently interested in looting Romney's funds for their own benefit with the actual campaign seemingly an afterthought.

I guess Romney just surrounded himself with shady people? Or perhaps people on the inside realized that Obama was probably going to win and were looking ahead to after the election. Either way, will be really interesting to see more of the post-mortem on the Romney campaign.

Or these people actually genuinely *thought* that their services were worth that much, that they really *were* the best people to draw in.

I mostly believe that the influx of SuperPAC money has made political parties more irrelevant. So Orca was a Romney operation rather than a GOP operation. You did not see it this time with Democrats so much because they had no primary season to battle through. Voters identify as Republican/Democrat not Romney or Gingrich, so a GOTV operation should be in control of the party. This is one of the areas where centralized planning is effective. A GOTV apparatus should be under party control, and the reigns should be handed over the primary victor before the elections. Instead of shutting down Orca, if the Republicans decide to continue with the team and make it a central part of the party, then come 2016 they will be in a better much better shape IMO.

Yeah, this article paints a rational and believable reason for the failure of the project: lack of time and resources. But I think we all know that the REAL reason it failed is that the project was sabotaged from within by blacks and Obama-voters! After all, I read that on the Internet, so it MUST be true!

So in the end this was a hastily planned thing, where they chose to rely on nepotism. Doing some friends a favor, instead of doing business. And besides, outsourcing is great, because if you pay someone else, they're responsible, right?It also seems like they had no real expertise in house, which usually means you'll fail because you can't even manage your contractors and consultants on the right level.

Sounds like what I'd expect from a thing run by politicians and perfectly fits my totally superficial impression of Romney. I'm a bit surprised Obama did so much better, though.

++ "This IT thing, anyone can do it, right? Let's just out-source this shit." It seems like Romney's corporate raider background came back to bite him in the ass. Ah, the irony. Ok, to be fair, how well did they do what they were expected to do?

I suspect that there was at least one other set of major factors that affected the different IT outcomes, driven by the outsourcing/insourcing difference.

When a campaign hires people directly, those people are more likely to be strong, enthusiastic supporters, and they know it is a short-term job and certainly not a career job, often done more for passion than for pay. On the other hand the classic problems with outsourcing are opportunism, charging as much as possible, and a generally much lower feeling of "skin in the game", caused by a general misalignment of interests.

I guarantee you a young enthusiastic volunteer who left their main job for a year to help with the campaign at low pay is going to work harder than somebody with a steady job working for some consultant hired by the campaign.

"our presumption the whole time was these guys are smart business guys"... And there is the problem the Romney campaign and the republican view of the world.Every business I have ever been a part of has treated IT as a necessary evil, and pretty much anything without a straightline financial benefit.

Did the RNC really not have any infrastructure ahead of time and leave the Romney campaign to build the entire thing? That seems... poorly thought out. Sure the Obama team had a four year headstart vs Romney, but it's not like the RNC didn't know *someone* from their party would be running for president.

There may be other reasons, but even within parties there are a lot of disincentives for sharing this kind of thing. One of the most valuable and powerful tools/weapons a former candidate has is their databases. Down the line that can be used to support a future candidate in the primaries, support advocacy and lobbying activity, and so forth. I am sure the the DNC and RNC would love to get their hands on Narwal and Orca (even if Orca is still not ready for primetime), but in the immortal words of Gov. Blagojevich "I've got this thing and its fucking golden. I am just not giving it up for nothing"

Holy cow! Over half of the IT budget was spent on "campaign finance compliance software" That's some compliance.

Along with the above mentioned friendly advantage, this often happens with IT budgets. Something is decided as important, finance compliance being a big one, so it just receives an absurd amount of the budget. It was probably never really considered part of IT spending though, it's a necessity. Everything else winds up being "well, we need something in this IT thing, but we don't want to spend too much".

It always winds up being very hard trying to do a small version of a big project. It tends up being a bad version of a big project, especially when your competitor is kicking your ass, it spurs people to try things that are far too ambitious, like Orca, rather than just going "we have this much cash, we'll run small web campaigns with it".

That's the Bain Way. Squeeze all the money you can out of it for yourself, and leave someone else holding the bag. Hilarious that this time Romney is the one who got Bained.

We shouldn't be surprised at the way this turned out, we ought to be surprised that the Salt Lake City Olympics -didn't- turn out this way. Then again, maybe it kind of did given the 1.3 billion dollars the Federal Government poured into it.

The guy was primarily a corporate raider. His career pretty much consisted of screwing the other guy, whether it be employees, pensioners, suppliers, shareholders of takeover targets, or the suckers that bought companies once he was done bleeding them. Sometimes using tactics bordering on fraudulent. Had he won, in 4 years the country would be up on blocks with the rims and stereo missing.

What's really depressing is that nearly half of the country voted for Romney because he was a CEO who had unquestionable business acumen.

Well, every tech company that gets its techie CEO replaced by someone from a business background gets seriously screwed over. Apple had to be rescued by Microsoft when it happened to it!

So, really, if implication ran both ways, this would actually prove Romney had unquestionable business acumen. I sometimes wonder why aren't there more studies about what makes business people suck so much at IT.

Bradley Crate founded Red Curve Solutions in 2008 after serving as the Deputy Chief Financial Officer for the Romney for President campaign. Previously, he worked in the Romney administration as a fiscal policy analyst and Director of Capital Planning and Policy and as the Political Operations Director for his 2002 campaign for Governor.

Other people have a similar background.

Basically, a 'friends of Romney' company. One wonders whether their services were really worth several hundred thousand dollars, or whether this was just a way of funneling campaign donor money to some old friends.

My guess is that friends were given extra money, but they were expected to do stuff just as well as the professionals. Rather than paying less for actual professionals.

The cronyism doesn't surprise me though. That's really how the party works. What surprised me was that they let it hurt them this badly.

What's really depressing is that nearly half of the country voted for Romney because he was a CEO who had unquestionable business acumen.

Well, every tech company that gets its techie CEO replaced by someone from a business background gets seriously screwed over. Apple had to be rescued by Microsoft when it happened to it!

So, really, if implication ran both ways, this would actually prove Romney had unquestionable business acumen. I sometimes wonder why aren't there more studies about what makes business people suck so much at IT.

No need for a study on that. It's really simple.

Business people are trained to make money. They're trained to efficiently produce a product that someone else will purchase. So they're trained to organize people around producing that product.

IT people don't produce the product. To business people, they're like the janitorial staff: they're doing something technically important, but obviously not vital to the bottom line. So obviously you can hire anyone and stick them in that position.

Technical people know that IT is important because IT keeps the ship functioning. Business people want to cut costs, and IT is a cost that has no direct impact on getting stuff done.

Sean Gallagher / Sean is Ars Technica's IT Editor. A former Navy officer, systems administrator, and network systems integrator with 20 years of IT journalism experience, he lives and works in Baltimore, Maryland.